Last week I touched on the topic of offering a "Land Only" rate for your group participants. This can allow a welcome touch of flexibility for the travelers, and perhaps cost savings if they wish to use earned air miles to purchase a part of their trip.
However, it is important to understand that consequences for the group may then be set into motion.
Group tour pricing is based upon the particular itinerary, services, and transportation for a minimum number of fully paying persons. Hotel accommodations for the group are priced according to a specific room configuration (normally double occupancy). Group air is usually booked in Economy Class, and contracts carry very stiff conditions and penalties. This is because a deposit is required for each seat blocked, and if the group does not use all of the number of seats blocked for the group, the airline will levy a per person penalty for each unsold seat in the block.